Why it sucks to be rich

Before we get underway today, it bears mentioning in the face of the Ubuntu Forums cracking — down for seven days now, guys . . . it’s that big a problem? — that we know who has root, or at least Mark Shuttleworth said so when he wrote, “Don’t trust us? Erm, we have root. You do trust us with your data already” in his blog item here from September of last year.

So, can we get a show of hands? Still trust him with your data?

OK, perhaps that was hasty, and I take it back. I know it must really suck to be rich; to have the one-percenter problems that I could not begin to imagine. I understand the wealthy don’t have the same concerns as those of us who have too much month at the end of the money while splitting hairs between paying utility bills and buying enough ramen for the rest of the week.

But mac-and-Velveeta problems pale in comparison to what Mark Shuttleworth has had to go through recently. Apparently, Mark has had to lawyer up and sue the South African government to have South Africa’s exchange control system declared unconstitutional, as well as having the High Court in Pretoria set aside a levy of over 250 million rand he had to pay to get some of his assets out of the country in 2009, and order the SA Reserve Bank to return the money.

According to the iafrica.com article linked above, “[Shuttleworth] had assets worth over R4.27 billion in South Africa when he emigrated, but transferred the assets out of the country in 2008 and 2009, each time paying a 10 percent levy.”

Ouch. Ten percent of your fortune stays behind when you leave your country for a tax haven like the Isle of Man? That’s truly not right, and on principle I would certainly agree that Shuttleworth deserves his money. No lie and no sarcasm: Mark definitely did the right thing in filing suit.

That was in April. The Durban reported on July 19 that the High Court in Pretoria has struck down Shuttleworth’s case. While The Durban reports the court “on Thursday [July 18] dismissed Shuttleworth’s application to strike down the whole of Section 9 of the Currency and Exchange Act and all of the Exchange Control Regulations as unconstitutional,” they did find parts of it unconstitutional, but most importantly it appears that the 250 million rand is lost for good to the South African government.

That certainly must have put a damper on the Ubuntu Edge Indegogo campaign rollout on the Monday following the ruling. As an aside, this is what 250 million rand looks like in U.S. dollars: At roughly 0.102 dollars to the rand, it comes out to roughly $25.6 million, just $6.4 million short of the $32 million that Ubuntu Edge is seeking in their campaign ending on Aug. 21.

Pity, since if the South African court had ruled in Shuttleworth’s favor and this windfall was returned to him, imagine how far along the Ubuntu Edge Indiegogo campaign would be if he donated some, most or all of it.

Sorry about losing the suit, Mark — you truly got hosed. And seriously, good luck with the campaign.

===

But, hey, I said “Ubuntu Edge” again: Every time I blog and Ubuntu Edge is mentioned, I am going to repeat the following from a previous blog. I still strongly advocate for folks to donate to the following groups instead of giving millions to a company like Canonical which doesn’t care much about anything other than itself. Give instead to:

Reglue (especially Reglue, which is creating a new generation of FOSS users as you read this sentence)

Partimus (bringing Linux boxes running Ubuntu to classrooms in the San Francisco Bay Area, or any other project like it)

This blog, and all other blogs by Larry the Free Software Guy, Larry the CrunchBang Guy and Larry Cafiero, are licensed under the Creative Commons Attribution-NonCommercial-NoDerivs CC BY-NC-ND license. In short, this license allows others to download this work and share it with others as long as they credit me as the author, but others can’t change it in any way or use it commercially.

(Larry Cafiero is one of the founders of the Lindependence Project and develops business software at Redwood Digital Research, a consultancy that provides FOSS solutions in the small business and home office environment.)

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I need to know more about this before I would agree the levy is unfair. You’re pulling a huge chunk of money out of the country – and that does wonky things to economies. It is not entirely crazy that governments do what they can to put the brakes on sucking money out of the country to a more favorable country with more friendly tax laws… Not saying I definitely disagree, but I’d need to know much more about this before saying Shuttleworth is in the right here.